Alcohol Sales Plummet

By cwaltersFebruary 25, 2009

What’s up, beer drinkers of America? Bloomberg notes that “take-out sales of alcoholic beverages tumbled 9.3 percent in the fourth quarter, the steepest drop since the U.S. Commerce Department started compiling data half a century ago,” and a drop four times greater than the overall fall in consumer spending. Most of that was due to the 14 percent drop in beer sales.

The website fivethirtyeight.com posted this chart last week, and although the scale sort of dramatizes the extent of the drop, it’s still clear that in the past 40 years alcohol sales have never fallen more than 4%.

Fivethirtyeight suspects it’s a type of conspicuous nonconsumption:

a manifestation of Calvinist guilt over both the present failures of the economy and its prior excesses. A deliberate effort to deny oneself pleasure.

@b.k.: When Mr. Taco used to have three tacos for $1.89, I used to crush nine of them at one sitting. And yes, while their taco sauce might not have been hot or super-flavorful, it was somehow perfect.

@Yoko Broke Up The Beatles: It was a regional taco place in Michigan. They had their own brand of sauce in little packets that made the perhaps-not-greatest-grade quality of meat they used a thing to overlook. They went under about four years ago. Plus as Helldog mentioned, they were ridiculously cheap, which meant that if you were a college student in the 80’s and 90’s, Mr. Taco was a main source of sustenance.

As a fellow Okie, I agree. Beer prices have also risen over time. I always buy the good stuff anyway, but these days, I brew at home. If you’re in the OKC area, there’s a good brewing store on thirty-something and Penn.

I wonder what different distribution channels that chart takes into account. Specifically if it includes warehouse stores such as Costco. As the recession has gone on I’ve found myself buying my beer and wine mostly from Costco to save some money, even if it narrows down my selection. I wonder if others are doing the same and that is making the chart look worse.

@Snarkysnake: I’ve never understood why some people justify alcohol as a necessary expense. If you cut eating out in the name of saving money, why not stop buying alcohol too? I had friends who were going “woe is me, I have no money,” and keep buying beer along with their bread.

@pecan 3.14159265: If you go to any low-income or depressed area – ghettos, hick towns, Indian reservations, and the like – you will find an abundance of liquor stores and drunks. Liquor is a way to forget about your poverty. Going to restaurants isn’t. That’s why.

@youbastid: Low income areas aside…for people who look at alcohol as a social event, I just wonder why they think they’re so smart if they keep buying the one thing that costs the most, and isn’t necessary for nutrition.

Sam Adams. Now there is a good beer, but it’s time they bring the price down. They’re no longer a Micro-Brew or Craft Beer. There is no reason for their beer to cost just the same as DogFishHead or likes of.

I can no longer afford craft beers and micro brews. I can barely afford Bud Light. I’ve had to move on to cheap rum. $14 a half gallon or $16 for a 24 pack. What would you choose?

@oldtaku: Beer prices have been increasing steadily for a while, and primarily for reasons other than the financial crisis: Now that more farmers are growing corn for biodiesel, fewer farmers are growing the barley and other grains used to make beer, making them scarcer and more expensive. There’s also been a significant hop shortage over the last two years that drove hop prices sky-high, and forced many smaller breweries to change their recipes or go out of business entirely.

So yeah, just as the American craft brewery movement’s started to really take off, the market’s decided to go and kick it in the nuts. Pisses me off.

@pecan 3.14159265: Here is more than everything you need to know, and here is some more resources. There may be more but I don’t run with that crowd so much anymore since I hit the limits of work I’m willing to do for homebrew a while ago.

Finding your local microbrew store, about $70, and some extra space will set you up with the basics.

@Applekid: There are some great places to order from online too, such as NorthernBrewer. They sell basic “starter” kits with low shipping costs, and have some really good ingredient kits so you can start brewing right away. If you want to use glass carboys, though, definitely try to buy them locally, because shipping on those things is a bastard and a half.

I’ve been brewing for a year now and it’s fun as hell, not to mention really satisfying when you open a bottle of something good and say, “Hey, I made this.”

I’m glad I live in a state with sane alcohol laws (MO). 18 dollars for a 12 pack is nuts. What state are you living in that taxes booze that badly? It is 6-8 bucks here. I gladly pay $18 for a 5th of mid-shelf liquor. Which can be sold anywhere here. We have few liquor stores because grocery stores and gas stations can sell anything (including wal-mart).

$18 a 12 pack for even Sam Adams is high, but Sam Adams in an overpriced beer to begine with. It’s a little over $8 a six pack in my neck of the wodds, and can bet it’s near the same in your area. They sell their beer for about $2 more than it’s worth.

My own anecdotal experience contradicts this story. A relative who works at an independent local liquor store recently told me that sales are steady.

Her theory is that people tend not to eliminate petty luxuries even in tough times. People might skip going out to dinner but will pick up a couple bottles of wine instead. Also, a lot of drinkers are intensely brand-loyal and as a result don’t trade down to save money.

@JiminyChristmas: I’ve got hard evidence to back this anecdote up; I work in a large wine and liquor store, and we’re up about 20% year-over-year at our site in gross volume. Chain-wide, I think we’re up something like 10-15%.

People don’t drink out as much during recessions, they don’t eat out, so they buy their wine and booze for home consumption. When two bottles of beer at a bar costs the same as a six-pack at home, drinking at home is a good way to tighten the metaphorical belt. Yes, some segments are down (wine over $50 is pretty slow right now, for example), but overall, we’re pretty busy in the liquor business.

@corkdork: I’m glad you had those numbers – I know my friends and I have cut back a lot on going out for drinks and dinner on the weekends, opting for movie nights and dinner at home. Instead of buying a $20-$30 bottle of wine at a restaurant, we’ll pick up a couple of $10 at the liquor store.

@JiminyChristmas: If anything, I’ve been drinking more the past few month – although I haven’t been brand loyal at all. High gravity Imperial Stouts have been replaced with $3.99 six-packs of Trader Joe’s lager or cheap ass wine from the grocery store.

I’m not drinking every night, and when I do drink, I’m not typically getting tanked, but I’ve definitely increased the drinking as the economy tanks. And I’m pretty sure there’s a direct correlation to that.

It was just horrible timing in my case. I’ve got enough money for beer – sadly, I was recently diagnosed with celiac disease. No more beer for me & there’s not much else in the way of alcohol that I actually like drinking. :(

@grumpygirl: There are a number of gluten-free beers you may be able to have. Anheuser-Busch makes one called “Redbridge,” and Lakefront Brewing makes one called “New Grist.” Might be hard to find (or a special order), but it’s beer you can have :)

Yeah plenty of beers are made with rice. Check it yo! I believe Budweiser is too? I may be mistaken, it may just mostly be rice. You can also drink vodka, watch out for a lot are made with grain, not potatoes. Try Monopolova it’s potato and not too spendy.

@grumpygirl: my husband also has celiac disease. Redbridge and cider are his weapons of choice. New Grist, Bards Tale, Ramapo Valley Honey Passover and a few other micros are also great, but expensive.

And while jvandub is right about the vodka thing (Kettle One or Ciroc are best bets) you also have to watch out for some wines, too. We always wondered why wines would occasionally bring on a reaction, and it turns out that some yeast blends are germinated on a gluten base. After they are harvested and used to ferment other spirits, they transfer the gluten they were grown on. It takes some getting used to and isn’t an easy thing to live with–good luck!

@Eyebrows McGee: Haha, June’s alcohol bills between the grocery store and two nights out in the city were $375 for the two of us. Then we got pregnant in July and that dropped to $0. The savings went into a daycare fund–figured it was best to set aside now so we can resume our bad habits this summer without too much budget shock.

@GirlCat: I haven’t been able to find any of the two buck Chuck (though it’s admittedly three here) in ages. People have been tearing through the cheaper wines at TJ’s and even the cheap vodka. It has been making the prospects of sangria a lot less thrifty.

@johnva: Yeah, I think the pricing has reached that tipping point where people simply don’t buy.
It seems people’s taste in beer is getting more and more sophisticated too. The $3.50 six pack of Old Style is just not good enough to buy anymore and the $8.00 six pack of Spotted Cow is just too expensive.

Svedka Vodka seems to be a hot item right now. I’ve seen it sold out a few times already. In a few more months, skol vodka will probably be in the same situation. Desperate times call for desperate measures.

My beer drinking has dropped some, not because I’m denying myself of pleasure, but because I drink more expensive beer and I’m tightening my budget some and alcohol is the easiest expense to cut. Combine that with it being winter, I haven’t bought myself a case of beer in months, whereas I used to buy at least on a month.

However, Philadelphia Beer Week is fast approaching. So I’m planning on splurging then.

In a bad economy, people tend to trade down. The article states the $ value has declined, but doesn’t mention volume. So, instead of Sam Adams and Chimay, people are drinking Natural Light, and Bush. In terms of alcohol, that Grey Goose is being replaced by Absolute and the Absolute drinkers are switching to Popov.

I’d be interested to see how the volume is impacted, and if more people are hanging out at bars (the article references take-home sales), since misery loves company.

I can see a direct correlation here between the Oregon Smoking Ban and the sales of alcohol. I know I’ve stopped drinking as much due to this ban, not sure if it’s economic b/c my income is still the same but I used to drink a few times a week when i could smoke, now I’m down to once a week, if that! Plus we do drink a lot of alcohol here.

One reason for the increase in beer prices is, farmers have been increasing corn production for use as ethanol. Because of this, production of hops, and barley has decreased making those commities more expensive. We apparently have two choices, cleaner fuels or cheaper beer.